SHERU response to the UKG Green Paper on changes to health and disability benefits
The Green Paper on ill health and disability welfare reform published on the 18th March follows weeks of media speculation on UK Government changes to incapacity and disability benefits. While full details won’t be available until the Spring Statement next week, this marks the first official position from the UK Government—moving beyond unhelpful leaks and conjecture.
The key headlines are:
· The UK Government is abolishing the Work Capability Assessment, which currently determines eligibility for the health element of Universal Credit (UC).
· A stricter Personal Independence Payment (PIP) assessment will be used to determine eligibility for both PIP and additional health-related support in UC.
· Access to the health element of UC will be delayed until the age of 22.
· Financial support within the health element of UC will be reduced, with a freeze for existing claimants and a 50% cut for new claimants.
· A new “right to try” will be established in law, ensuring that individuals who move into work will not be automatically reassessed for disability benefits.
Devolution means that some of these changes won’t apply in Scotland – for example, PIP is being replaced by Adult Disability Payment (ADP) in Scotland. The changes made by the UK Government to PIP eligibility will affect the funding available to the Scottish Government for ADP but no figures have been released yet to allow us to estimate the impact.
Furthermore, there is no detail on how UC claimants in Scotland will be assessed for the UC health element given that PIP is being phased out. The UK Government will need to work with the Scottish Government to work this through, and it is regrettable this was not done in advance of the announcement.
The UK Government is trying to curb a rise in claims for disability and health related benefits that have been growing since the pandemic and are forecast to continue to rise in future years. The first question to try and answer is why have more people been claiming health and disability related benefits?
Understanding rising caseloads
SHERU recently published a report comparing devolved disability benefits in Scotland with those in England and Wales, aiming to uncover insights into population health.
Our briefing noted that the increase in disability benefit claims—such as Personal Independence Payment (PIP) and Adult Disability Payment (ADP)—can stem from multiple factors including a genuine rise in health conditions or worsening economic circumstances driving more people to seek financial support and greater awareness of entitlements and reduced stigma around claiming benefits.
The Fraser of Allander Institute (FAI) has also provided an explainer that also examines reserved health-related benefit claims under Universal Credit (UC) and Employment and Support Allowance (ESA).
More broadly, rising caseloads signal deeper systemic issues. When more people rely on social security, it often reflects upstream problems in public services (including the NHS) and economic security. Addressing these root causes is key—reducing benefits alone risks worsening poverty and health inequalities.
The FAI explainer highlights additional factors influencing incapacity benefit growth, such as the rising pension age, which classifies more older people as “working age” and other factors that may be contributing. It’s fair to say that no one currently can pin down the exact reasons for why more people are claiming support as there are multiple factors intersecting to drive the rise.
Insights from new DWP qualitative research
Our SHERU report highlighted the need for more evidence, particularly qualitative evidence, that draws on the experience of people drawing on benefits. Since our report, the DWP has published interim findings from research based on surveys and qualitative interviews with claimants in England and Wales.
This report provides some detailed insights from people drawing on health and disability benefits. A lack of appropriate and timely health care emerged as a key issue (40% of people surveyed were on a waiting list for medical treatment). But people also reported struggling with broader issues, including lack social care, issues with housing and accessibility of transport. Many people also talked about financial struggles and how this can be a barrier to finding work. For example, people highlighted the importance of financial support for work-related expenses, including interview clothes, equipment and travel costs.
While the research focused on England and Wales, these issues are likely to be just as relevant in Scotland.
The changes announced in the Green Paper include some reinvestment of savings in services to help people into work, and the ‘right to try’ should help some people who are closer to the labour market into work.
However, it is unclear what evidence they have drawn on to support their decision to reduce benefits as a way to help people into work. As well as reducing income for work related expenses, there is a risk that increased financial insecurity could, in fact, worsen people’s health and reduce their long-term job prospects.
Implications for Scotland
As discussed in this brief from the Fraser of Allander Institute, the full implications for Scotland are unknown. The tightening of PIP eligibility will mean less money for the Scottish Government’s devolved ADP benefit, but we don’t yet know how much yet. The Scottish Government will however be faced with a decision on whether to replicate the changes or to find additional funds from elsewhere in the Scottish Budget (more on this below).
As mentioned above, how the changes to eligibility for the UC health element will operate in Scotland where PIP is being phased out is uncertain. The other UC changes (reductions in the health element, restrictions for under 22s claiming the health element and the ‘right-to-try’) will apply to people in Scotland.
The increased funding for employability services could result in more money for devolved employability in Scotland, which we would then expect to be funnelled to local areas as part of the No One Left Behind programme. We will need to wait for confirmation of this as some UK Government employability programmes run UK-wide. Either way, the changes announced are likely to lead to an increased demand for employability support from people who would otherwise have not been in work due to ill health, which services in Scotland will need to respond to. The needs of these new claimants will necessitate high quality support that recognises the multiple barriers to work that they face.
More uncertainty ahead?
The Scottish Government’s robust criticism of the UK Government’s decision makes it unlikely that they will follow suit and make ADP more stringent in Scotland. But a period of uncertainty whilst both the Scottish and UK governments make sense of what these changes will mean in Scotland is inevitable and will lead to more worry for claimants north of the border.
However, the Scottish Government will need to make a considered response that recognises the trade-offs they are faced with. If more money is diverted into the social security budget to keep the same ADP eligibility, then analysis of the impact of those reductions elsewhere will be need to be part of the considerations.